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Watch John McDonnell's speech at Labour Party conference 2017 live

Shadow Chancellor of the Exchequer John McDonnell Photo: PA

A Labour government would cap credit card interest so that no-one pays back more than twice the amount of their original borrowing, shadow chancellor John McDonnell has announced.

In his keynote speech to Labour's annual conference in Brighton, Mr McDonnell accused the Government of creating a "debt crisis" which is becoming a threat to the economy, with 3 million people trapped in persistent debt with credit cards in the red by a total of £14 billion.

Watch the speech again here:

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He called on ministers to apply the same cap on credit card debts as on pay-day loans, limiting interest and charges to 100% of the amount borrowed. He will promise that if they fail to act, Labour will change the law when it wins power.

Mr McDonnell said: "The last seven years of Tory economic failure has created the perfect storm, as wages have fallen behind, more and more families are being pushed deeper into debt.

"Under pressure, the Government has been forced to cap interest payments on payday loans. But more than 3 million credit card holders are trapped by their debt. They've paid more in interest charges and fees than their original borrowing.

"The Financial Conduct Authority has argued for action to be taken on credit card debt as on payday loans. I am calling upon the Government to act now to apply the same rules on payday loans to credit card debt. It means that no-one will ever pay more in interest than their original loan.

"If the Tories refuse to act, I can announce today that the next Labour government will amend the law."

Mr McDonnell also announced plans for a Strategic Investment Board, made up of the Chancellor, Business Secretary, Governor of the Bank of England and the new National Investment Bank, to channel funding into keeping Britain up to speed with the "fourth industrial revolution".